A typical insurance purchase or renewal includes receiving information from a client (the potential purchaser), submitting this information to one or more insurance companies and receiving a quote from the insurance companies for the requested coverage. The client selects one of the quotes and the insurance company issues a binder to the client evidencing that the insurance has been purchased and is in force. However, it may be several months until the client has the actual insurance policy in-hand and is able to review all the specific terms in the policy.
This leads to several issues for the client, the insurer and the insurance intermediary. For example, when the actual policy is received, there is a need to reconcile its terms with the agreed terms to verify that the terms in the actual policy are consistent with the agreement between the client and the insurance company. In another example, if a loss occurs in this intervening time frame between the issuance of the binder and having the actual policy in-hand, there may be uncertainty as whether the loss is covered. Thus, this lack of having the insurance policy at the time the coverage is bound by the insurance company, may lead to confusion and frustration between the client and the insurance company.